By Jim Fedele, CBET
I am sure everyone has noticed that many consumer electronics continue to decline in price. However, this same trend does not seem to transfer to the price of medical equipment. With all the sales that were going on during the holidays and my facility’s end of the year request for new medical equipment, has got me questioning why?
I remember shopping for my first home PC like it was yesterday. It was a top of the line unit at the time, 486 processor with a 40 MB hard drive. I upgraded the RAM from 256 MB to 512 MB. The price was a steal at $1,600. Today you can purchase a unit that has a hundred thousand times more computing power for $500 bucks. Also, I am continuously amazed at the costs of flat screen TVs. In 2005, a 32-inch flat panel LCD would set you back around $1,500. Today the same size LCD TV will cost you only 200 bucks and that includes a HD receiver. If you love video games as I do, game systems always start out high and each year get cheaper and have more options after each passing year. For the consumer electronic industry, this is only the tip of the iceberg. Everything from cellphones to DVD players and computers and automotive electronics have gotten less expensive. They have gotten less expensive while at the same time improving with more features and capabilities than we could have ever imagined from their predecessors.
In contrast, I look at medical technology. I can agree that medical technology has advanced regarding features and size, but there has not been a noticeable reduction in cost. I used the two examples above to specifically illustrate my point. Medical equipment that utilizes computers and flat panel technology have benefited from the advances in these technologies. It has yielded smaller, lighter and clearer monitors. However, as I was receiving quotes for our new emergency department monitoring system, I was surprised to see that the costs were more than what we paid for our old system. It does not make sense to me given all we see happening in the consumer electronics industry. Frankly, the devices in the consumer electronics market typically perform their assigned function better over time while also decreasing in price. On the other side, our new physiological monitors still function the same way, they use cables and sensors (which have increased in price) to be connected to the patient so the monitor can display the information. No HD, no streaming video, no quad-core processors, nothing that really positively affects the patient or the user. I am not saying that this is bad. I am wondering why we have not seen the kind of price reductions that we have witnessed in the consumer electronics industry. Don’t they all use the same resistors, capacitors and computer chips? Another gross example of this are the monitors for video surgical systems. The last quote I received listed a 26-inch “Medical Grade” monitor at $7,000. One can buy a 60-inch, full HD monitor (with built in Wi-Fi, surround sound and a wall mount) for $3,000. Apparently, the “Medical Grade” distinction requires that all solder joints be constructed with gold instead of the normal tin and lead.
When I first started in this industry 30 years ago, the medical equipment at that time did have innovations that the consumer market did not have. I remember our first touchscreen and PC-based monitoring systems. At the time, they felt cutting edge. Now, other than the miniaturization of components and the ability to lock out biomeds from fixing equipment, I am underwhelmed by the present state of innovation from medical equipment manufacturers. At a minimum, I expect the equipment to be less expensive given that everyone else in the electronics industry has found ways to manufacturer less expensive devices for the consumer.
I have posed this question to my sales reps and some disagree. They feel that medical equipment has come down in price. Others tell me it is safer now and others have pointed out some minor new features like Wi-Fi connections and electronic integration. Some point to regulation and the FDA as a driving factor for increased costs. I am sure there is merit to some of the arguments. However, when you consider the reduction in costs for consumer electronics being what it is, it is hard to believe that these factors are solely responsible for the pricing. My opinion is that a lack of competition in the medical device field has kept prices high and stymied innovation. The tools and material needed to create great products have never been more abundant. I think the big companies are OK bleeding the health care industry dry while offering token improvements to their designs.
In closing, I would ask that each of you ask your sales reps when the cost of medical equipment is going to be less expensive?
Jim Fedele, CBET, is the senior director of clinical engineering for UPMC. He manages six Susquehanna Health hospitals. He has 30 years of HTM experience and has worked for multiple service organizations.
The views expressed here are those of the author and do not necessarily represent or reflect the views of TechNation or MD Publishing.
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